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Judge Sides With Doctors In Cancer Contracts Dispute

Gavel and a stethoscope
Flickr Creative

Siding with state lawmakers and doctors, a federal judge on Wednesday ruled against a major cancer center in the latest round of a bitter dispute between the treatment provider and its physicians. 

U.S. District Judge Mark Walker denied a bid by 21st Century Oncology to block a newly enacted law that voided no-compete clauses placed in contracts of doctors who worked for the center.

In his ruling, Walker compared the happenings at the state Capitol to the famed black-and-white horror movie, “Creature from the Black Lagoon,” filmed at nearby Wakulla Springs.

But the judge said that lawyers for the center had not presented evidence to justify a preliminary injunction.

Walker’s refusal to block the law from going into effect does not mean that the legal tussle is over, but it is a significant setback for the cancer center.

A representative of 21st Century Oncology said the company had no comment on the ruling.

The cancer-treatment center was trying to put a hold on a law, passed by the Republican-dominated Legislature this spring, that retroactively bans no-compete clauses for doctors who practice a medical specialty in a county where one company contracts with all the physicians who practice in that specialty.

The law bans such restrictions for three years after a second company comes into the county and starts providing the care. 21st Century Oncology is the largest provider of radiation oncology services in Florida, including in Lee County, where it is the only company providing the services.

Walker noted in his ruling that the state statute doesn’t run afoul of federal law because it "serves a significant, legitimate public purpose."

The law "is a significant impairment on plaintiff's employment contracts, but not a total one,” the judge wrote.

The federal lawsuit challenging the Florida statute came months after a group of physicians sued 21st Century Oncology. The News-Press reported the physicians alleged that “the cancer-care provider acts as a ‘monopoly’ by employing all radiation oncologists in Lee, Collier and Charlotte counties and, through restrictive contracts, prevents them from leaving and competing against them.”

Walker held an all-day hearing on the cancer center's request for a preliminary injunction on August 9.

At that hearing, attorneys for the cancer center had argued that the law didn’t serve a public purpose and was drafted at the behest of five physicians, including Michael Katin, who wanted to break their contracts with the cancer-treatment provider. Katin, who intervened in the case, worked for 21st Century Oncology until March.

The cancer center’s lawyers noted during the hearing that Katin established a limited liability company, called the Special Committee for Healthcare Reform, or SCHR, and hired a lobbyist to help pass the bill.

But Walker found that didn’t matter.

“Attempting to connect the dots, plaintiff contends these facts indicate (the law) was drafted by the lobbyist, acting on SCHR’s behalf, for the sole purpose of allowing the five physicians who left plaintiff’s employ to escape their noncompete agreements,” Walker wrote in his 23-page order. “At this stage, plaintiff has not shown a substantial likelihood (the law) serves an illegitimate private interest rather than a legitimate public  purpose.”

While Katin’s lobbyist spoke in favor of the measure during a Senate committee meeting, Walker noted the committee “also heard from a different lobbyist who opposed the bill on the grounds it would have ‘an unnecessary impact on the ability of hospitals and others to contract’ and would result in 'much litigation and many court decisions.’ ”

Katin issued a statement Wednesday praising the judge’s decision.

“These contracts force medical specialists to leave the county if they want to continue to practice medicine,” Katin said. “Patients are denied access to the physician of their choice when they leave. That is not in the public’s interest. Medical specialists are often in short supply in Florida counties."